Venture Capital in Southern California panel, moderated by the DeBord Report's Matt DeBord. These guys may be looking for different types of startups to invest in.
Fred Wilson, in typical clear and direct fashion, nails the shift as venture capitalists withhold additional rounds of funding from consumer-web companies and pivot toward the search for "enterprise" opportunities — ways to invest in software for businesses, not for the masses. Here's Fred:
[I]nvestors have moved from consumer to enterprise. there is a large pool of money in the venture capital asset class that is opportunistic, momentum driven, and thesis agnostic. this pool is driven largely by the public markets. this pool of capital was "all in" on consumer web/social web in the 2009-2011 time frame. it drove a lot of activity throughout the venture capital markets because each layer of the VC stack...needs to be aware of what the next layer up wants to fund. when the momentum/late stage wanted web/social, the layers below gave them web/social. Now that the momentum/late stage wants enterprise, we should expect the layers below to give them enterprise.
The combination of these three factors is making it harder for consumer internet companies (web and mobile) to get funding.
It's a beach. Just don't call it a Silicon Beach.
I missed this when it was fresh, but the debate is more-or-less evergreen, so I don't feel too bad about picking it up from Brad Feld's blog about tech and investing in Boulder, Colorado rather than Mark Suster's blog about tech and investing in Los Angeles. The topline summary: Mark — who started LaunchpadLA and is a VC at the biggest firm in town, GRP Partners — doesn't like the term "Silicon Beach."
It's not like he's breathing fire or anything. He's just trying to gently incite a larger discussion about the L.A. tech scene and the whole question of regional branding:
For me Silicon Beach doesn’t quite encapsulate the wonderful, dynamic, creative, large, thriving community that is the 13 million proud Angelinos any more than Silicon Alley captures the bustling 2012 community of New York City.
If anything using the word “Silicon” seems a bit derivative to NorCal. Don’t you think?
Interestingly, nobody I know in NorCal EVER calls it Silicon Valley, “Silicon Valley.” It seems to either be “The Peninsula” or “San Francisco” or even just “The Bay Area.”
To me, LA will always be a creative hub for TV, film, music, video games and now technology. We need to be different & unique. Not derivative.
The L.A. Times' Meg James has a great piece today about how a kind of advertising-tech axis is developing in Los Angeles, combining our resurgent ad agencies and all the new tech firms that have sprung up on the Westside and that are being called "Silicon Beach." (There was a Silicon Beach of sorts back during the 1990s dotcom boom, so this isn't so much a completely new thing as a reboot.)
Nowhere can this be seen more clearly than in the much-anticipated ads for the Super Bowl. Here's some salient language:
More than 110 million people are expected to watch the Super Bowl on TV, making it the biggest advertising event of the year. The pressure to perform is intense. Broadcaster NBC has charged a record $3.5 million for each 30-second spot. The commercials, which can cost an additional $2 million to make, will be analyzed and replayed as much as the action on the field. More than 20 of the high-profile commercials, including those promoting Hollywood films, were created locally.